Health Partners InitiativeNon-Profit

2022-001 - Significant Deficiency in Internal Controls over Compliance for Allowable Costs Identification data: U.S. Department of Health and Human Services (HHS) ? Centers for Disease Control and Prevention (CDC), PPHF: Racial and Ethnic Approaches to Community Health Program finance solely by Public Prevention and Health Funds, Assistance Listing No. 93.738, Agreement Identifying No. 18NU58DP006575 and 18NU58DP006575C5. Criteria: The Organization's agreements with the CDC provide for allowable costs to be claimed for eligible program activities, including payroll-related expenses for program and administrative personnel. Condition: The Organization provides for the allocation of program and administrative personnel costs to the program on the basis of time and effort. Inconsistencies and weaknesses in the methodology and documentation supporting such allocations were identified, including the lack of audit trail documentation that connects time study results with allocation determinations utilized within the Organization?s accounting system. Additionally, the Organization does not have a formal method for determining whether allocations based on estimated time and effort reflect actual results. Cause: A breakdown in the Organization?s internal controls over allowable costs did not allow the Organization to maintain complete and thorough documentation to support allocations of salaries costs to the program. Effect or potential effect: The control deficiency is a significant deficiency that prevented the Organization from maintaining sufficient documentation to support salary cost allocations to the program. Identification of a Repeat Finding: Repeat finding of 2021-001. Recommendation: The Organization should review its system of internal controls over allowable costs, specifically related to allocation methods for payroll-related costs, to determine improvements that can be made to ensure the Organization is maintaining sufficient, complete, and clear documentation to support its allocation methodologies. Additionally, if the Organization utilizes estimates of time and effort in its allocations, a look-back review should be performed to determine appropriateness of such estimates compared to actual results. Time study data, if utilized, should be performed on a routine basis to mitigate risks of inaccuracies. Views of Responsible Officials: The Organization updated their time study evaluations in response to the last single audit to increase the frequency of time study evaluations. However, because of the timing of the last audit being completed in the second quarter of the Organization?s fiscal year, it was found the first quarter of the fiscal year did not reflect the updated procedures. In response to the audit recommendation to increase in the frequency and formality of the time study evaluation and audit trail documentation, the Organization has adopted a more frequent schedule to consistently evaluate staff time through formally documented time study evaluations and will regularly adjust charged salary allocations to ensure a clear connection between time study results and allocation of costs within the Organization?s accounting system.

2022-002 - Noncompliance and Significant Deficiency in Internal Controls over Compliance for Reporting Identification data: U.S. Department of Health and Human Services (HHS) ? Centers for Disease Control and Prevention (CDC), PPHF: Racial and Ethnic Approaches to Community Health Program finance solely by Public Prevention and Health Funds, Assistance Listing No. 93.738, Agreement Identifying No. 18NU58DP006575 and 18NU58DP006575C5. Criteria: Appendix A to Part 170 of Title 2 CFR, Subtitle A, Chapter 1 describes the first-tier subaward reporting requirements under the Federal Funding Accountability and Transparency Act (FFATA), which requires prime recipients to report first-tier subawards to non-Federal entities equal to or exceeding $30,000 within 30 days. Condition: The Organization failed to report its first-tier subawards subject to FFATA requirements within the 30 day period. Cause: A breakdown in the Organization?s internal controls over reporting did not allow the Organization to meet the reporting requirements of the program. Effect or potential effect: The control deficiency is a significant deficiency that prevented the Organization from complying with the reporting requirements of the program. Identification of a Repeat Finding: Repeat finding of 2021-002. Recommendation: The Organization should review its system of internal controls over reporting to determine improvements that can be made to ensure the Organization actively tracks and adheres to reporting requirements outlined in its award agreements and included in the CFR. Views of Responsible Officials: The Organization was not able to gain login access to process the required FFATA first-tier subawards reporting timely. Accurate and functioning access to the FSRS system has since been obtained, calendar reminders have been set and a central reporting schedule has been established to ensure better monitoring of and compliance with reporting requirements of award agreements. The Organization has reviewed FFATA reporting requirements and has adopted a procedure to ensure such reporting is completed as required.

2021-001 - Significant Deficiency in Internal Controls over Compliance for Allowable Costs- Continued Condition: The Organization provides for the allocation of program and administrative personnel costs to the program on the basis of time and effort. Inconsistencies and weaknesses in the methodology and documentation supporting such allocations were identified, including the lack of regular and consistent time study evaluations and audit trail documentation that connects time study results with allocation determinations utilized within the Organization?s accounting system. Additionally, the Organization does not have a formal method for determining whether allocations based on estimated time and effort reflect actual results. Cause: A breakdown in the Organization?s internal controls over allowable costs did not allow the Organization to maintain complete and thorough documentation to support allocations of salaries costs to the program. Effect or potential effect: The control deficiency is a significant deficiency that prevented the Organization from maintaining sufficient documentation to support salary cost allocations to the program. Recommendation: The Organization should review its system of internal controls over allowable costs, specifically related to allocation methods for payroll-related costs, to determine improvements that can be made to ensure the Organization is maintaining sufficient, complete, and clear documentation to support its allocation methodologies. Additionally, if the Organization utilizes estimates of time and effort in its allocations, a look-back review should be performed to determine appropriateness of such estimates compared to actual results. Time study data, if utilized, should be performed on a routine basis to mitigate risks of inaccuracies. Views of Responsible Officials: In the past, the Organization has conducted time study evaluations a few times throughout the year to ensure proper functional allocation of expenses. Less formally, the Organization has evaluated the allocation of staff time to particular programs and adjusts charged salary allocations annually if needed or as changes in circumstances arise. In response to the audit recommendation to increase the frequency and formality of the time study evaluation and audit trail documentation, the Organization will adopt a schedule to more frequently and consistently evaluate staff time through formally documented time study evaluations and regularly perform and document a look-back review to ensure a clear connection between time study results and allocation of costs within the Organization?s accounting system.

2021-002 - Noncompliance and Significant Deficiency in Internal Controls over Compliance for Reporting Identification data: U.S. Department of Health and Human Services (HHS) ? Centers for Disease Control and Prevention (CDC), PPHF: Racial and Ethnic Approaches to Community Health Program finance solely by Public Prevention and Health Funds, Assistance Listing No. 93.738, Agreement Identifying No. 18NU58DP006575 and 18NU58DP006575C5. Criteria: The Organization?s program agreements require the Organization to submit quarterly Federal Financial Reports (FFR) to HHS. Additionally, Appendix A to Part 170 of Title 2 CFR, Subtitle A, Chapter 1 describes the first-tier subaward reporting requirements under the Federal Funding Accountability and Transparency Act (FFATA), which requires prime recipients to report first-tier subawards to non-Federal entities equal to or exceeding $30,000. Condition: The Organization failed to submit its Federal Financial Report for the quarter ended December 31, 2020 timely. Additionally, the Organization failed to report its first-tier subawards subject to FFATA requirements. Cause: A breakdown in the Organization?s internal controls over reporting did not allow the Organization to meet the reporting requirements of the program. Effect or potential effect: The control deficiency is a significant deficiency that prevented the Organization from complying with the reporting requirements of the program. Recommendation: The Organization should review its system of internal controls over reporting to determine improvements that can be made to ensure the Organization actively tracks and adheres to reporting requirements outlined in its award agreements and included in the CFR. Views of Responsible Officials: The Organization will set additional calendar reminders and assign a central reporting schedule to ensure better monitoring of and compliance with reporting requirements of award agreements. Additionally, the Organization has reviewed FFATA reporting requirements and has adopted a procedure to ensure such reporting is completed as required.

2021-003 - Noncompliance and Significant Deficiency in Internal Controls over Compliance for Subrecipient Monitoring Identification data: U.S. Department of Health and Human Services (HHS) ? Centers for Disease Control and Prevention (CDC), PPHF: Racial and Ethnic Approaches to Community Health Program finance solely by Public Prevention and Health Funds, Assistance Listing No. 93.738, Agreement Identifying No. 18NU58DP006575 and 18NU58DP006575C5. Criteria: Title 2 CFR ?200.332 subrecipient monitoring requirements for pass-through entities, which include the requirement that pass-through entities verify that every subrecipient is audited as required by Subpart F of Title 2 CFR ?200. Additionally, pass-through entities are required to monitor the activities of subrecipients as necessary to ensure that subaward are used for authorized purposes, in compliance with Federal statutes, regulations, and the terms and conditions of the subaward, and that subaward performance goals are achieved. Condition: The Organization did not verify the audit status of subrecipients. Additionally, the Organization does not have a formal process for tracking and monitoring the reporting requirements imposed upon subrecipients and whether reporting objectives have been met. Cause: A breakdown in the Organization?s internal controls over subrecipient monitoring did not allow the Organization to fully meet the subrecipient monitoring requirements under the program. Effect or potential effect: The control deficiency is a significant deficiency that prevented the Organization from fully complying with the subrecipient monitoring requirements of the program. Recommendation: The Organization should review its system of internal control over subrecipient monitoring to determine improvements that can be made to ensure the Organization actively monitors the reporting activities of subrecipients, including verification of subrecipient audit compliance. The Organization may consider communicating the reporting and audit requirements within its subrecipient agreements. Views of Responsible Officials: While, in the past, the Organization has provided reporting requirements and templates for reporting to subrecipients in their subrecipient agreements to comply with program reporting requirements, the Organization going forward will apply a better, more formalized tracking and follow up system to ensure reports are received and followed up on as needed. Additionally, the Organization will add language to the subrecipient agreements about audit requirements and adopt a procedure for subrecipients to provide a certification of their organization?s audit requirements.